Western Digital sells out 2026 HDD capacity as AI demand pushes prices higher (www.eteknix.com)

Western Digital has announced it has completely sold out its hard disk drive (HDD) production capacity for 2026, largely driven by increasing demand from AI-focused cloud companies and hyperscalers. During the second-quarter earnings call, CEO Irving Tan disclosed that all HDD output for next year has been secured through binding agreements with major clients, ensuring revenue visibility well into 2027 and 2028. This surge in demand, attributed to the ongoing "AI supercycle," highlights a significant shift in the market where enterprise needs are prioritized over consumer demands. The implications of this development are profound for the AI/ML community, as artificial intelligence applications require vast amounts of data storage, often measured in exabytes. While solid-state drives (SSDs) are rapidly evolving, HDDs still offer the most cost-effective solution for extensive data storage in data centers. As a result, enterprises are increasingly relying on HDDs, putting pressure on production and driving prices upward. Consequently, consumers and PC manufacturers may experience shortages and rising costs, marking a notable transformation in the landscape of data storage as businesses adapt to the burgeoning demands of AI technologies.